GoM Drilling Bill Clears Senate

Wednesday, August 02, 2006

An attempt to open a new section of the Gulf of Mexico to drilling cleared a major hurdle in the Senate, the Jackson Clarion Ledger reported. The 72-23 vote to end debate on a bill that would allow the first new offshore drilling in years was hailed by the nation's oil and gas industry as well as manufacturers, farmers and other businesses who seek decreases in the price of energy, especially natural gas. Promoted by Senate Energy and Natural Resources Committee Chairman Pete Domenici, R-N.M., the offshore drilling bill would open about 8.3 million acres in the eastern Gulf of Mexico to oil and gas exploration. The area is expected to produce 1.2 billion barrels of oil and enough natural gas to heat and cool 6 million homes for 15 years. Royalties from the new production would be shared between the federal government and four coastal states - Louisiana, Mississippi, Texas and Alabama. But Louisiana would receive the largest share of those new royalties - about $200m a year for the next decade. But environmental groups condemned the Senate action, saying it would end a 25-year-old moratorium on drilling off most of the nation's coastal waters. Some of the bill's opponents are concerned the Senate bill would become much broader during negotiations with the House, which approved an offshore drilling bill sponsored by Rep. Bobby Jindal, R-Metairie, in June. The House bill would end a 25-year-old moratorium on drilling along most of the U.S. coastline by allowing individual states to decide whether to allow gas and oil production off their shores. (Source: Jackson Clarion Ledger)